Return migration and labour market outcomes in South Asia: a CGE exploration

ABSTRACT This paper explores the impact of return migration on labour market outcomes, more specifically, wage, consumption and welfare outcomes for workers in South Asia. The unprecedented changes brought about by the pandemic have led to mass upheaval and the return migration of millions of workers over the past two years. This return migration is likely to lead to an expansion of the labour force and employment in South Asia. The impact of this labour force supply shock is evaluated using the GMig2 version of the GTAP model. We find heterogeneous results in terms of labour returns by levels of skill and industry. The sectoral demand composition changes with manufacturing and services gaining demand over agriculture and primary industries.